Newly installed French Pres. Nicolas Sarkozy poses with Justice Minister Rachida Dati in Paris after the first meeting of his cabinet on May 18.APFrance turned to a new political generation in 2007. In the May 6 runoff of the presidential election, the voters chose 52-year-old Nicolas Sarkozy of the centre-right Union for a Popular Movement (UMP) over the Socialist candidate, Ségolène Royal, to succeed Pres. Jacques Chirac. (SeeSidebar.) Sarkozy appointed François Fillon prime minister to head a new government, which went on to beat the Socialists in the parliamentary elections in June. Although he had formerly been a minister in Chirac-appointed governments, Sarkozy campaigned on a slogan of a “rupture” with the previous order. He quickly carried out some labour market and tax-cutting reforms and started a review of constitutional changes, including term limits for future presidents. While maintaining Europe as the prime focus of his foreign policy, Sarkozy was relatively pro-American compared with his predecessors. He showed signs of being more accommodating to the U.S. (especially with his active interest in a positive outcome in Iraq) and somewhat more trouble to some of his euro zone partners (with his criticism of restrictive European Central Bank monetary policy).

Domestic Affairs

The year was dominated by the presidential and legislative elections and their consequences. It began with Royal, already the chosen Socialist candidate, ahead in the opinion polls, but this changed after Sarkozy got the uncontested endorsement of his UMP party in mid-January. Both candidates had very personal campaign styles and platforms. The photogenic Royal in her trademark white jacket held lengthy grassroots meetings across the country, while Sarkozy crammed stump speeches into a timetable that until March involved being interior minister as well as a presidential candidate. Royal mixed standard left-wing economic prescriptions with a call for military-style boot-camp treatment of youthful delinquents. Sarkozy was ready to call himself a liberal, but neither his economic interventionism nor his hard-line immigration policy bore this out. Both candidates too had to cope with personal problems. Sarkozy’s were well known because of the publicity surrounding an earlier temporary separation from his wife, Cécilia (which led to a very public divorce announcement in October). Royal’s domestic problems were confirmed only when, the day after parliamentary elections in June, she announced that she had separated from her partner and the father of her four children, François Hollande, the head of the Socialist Party. This explained elements of tension that had appeared during the campaign, such as when Hollande called for certain tax cuts that Royal promptly rejected.

The nature of the two main contenders—Sarkozy with his polarizing affect on the electorate and Royal, whose slipups in foreign affairs made her look like unpromising material for head of state—sent voters looking for an alternative, especially the centrist François Bayrou. At one point he was polling within a couple of percentage points of Sarkozy and Royal, but his bid eventually fizzled. Even the result of the first round—normally the occasion for protest votes for candidates with no chance of winning—confirmed the solidity of the traditional political cleavage. At the expense of fringe parties, the two mainstream candidates got their highest combined percentage of the vote in more than 30 years.

The UMP did less well than expected in the parliamentary elections but still well enough to provide a comfortable majority for the new Fillon government, with 313 of the 577 seats in the National Assembly. Former prime minister Alain Juppé was forced to resign from his post in the new, smaller cabinet when he lost reelection to his parliamentary seat. In the subsequent reshuffle, Christine Lagarde was shifted from agriculture minister to finance minister, becoming the first woman to hold France’s top economic post. Even more surprising was the appointment as foreign minister of Bernard Kouchner, a maverick Socialist who, unlike everyone else in his party (and Sarkozy himself), had originally supported the U.S.-led invasion of Iraq (on humanitarian grounds). Another striking nomination was that of Rachida Dati, the first full cabinet member of North African origin. In addition to giving a ministerial job to Eric Besson, a Socialist MP who had quit the Royal campaign to join Sarkozy’s, the new president subsequently appointed former Socialist cabinet minister Jack Lang to his constitutional-reform committee and supported another Socialist, Dominique Strauss-Kahn, to be managing director of the International Monetary Fund.

To some extent Sarkozy therefore created a coalition government, which influenced his decision not to scrap the famous law that placed a 35-hour maximum on the standard workweek (a landmark Socialist law) but rather to use tax relief on overtime pay to moderate the law’s rigidity. He also endorsed payroll tax cuts, the easing of restrictions on the firing of workers, and other business-friendly policies. Carrying out a campaign pledge, he pushed for an end to the special pension privileges enjoyed by rail workers and other public-sector employees. Sarkozy faced down a nine-day national train strike in November and a brief stoppage in December, but it remained unclear whether he could achieve the negotiated solution to this issue that had eluded previous French leaders.

Meanwhile, life out of power was somewhat harder for two men in the departing Chirac government. Dominique de Villepin, the former prime minister, had to answer police questioning on the so-called Clearstream scandal, which had involved an alleged attempt to smear Sarkozy. With the end of the presidential immunity that had shielded him for the past 12 years, Chirac faced magistrates’ questioning for allegedly having put party workers on the city payroll during his 18-year stint as mayor of Paris. Chirac wrote in Le Monde newspaper that city funds had been used only to serve Parisians but that he had needed to hire more staff for his expanded responsibilities, which included being an MP, the head of a political party, and prime minister. In February former Chirac minister Michel Roussin had his conviction for corrupt party financing in the city upheld by a Paris court.

Foreign Affairs

Sarkozy put new vigour into—and added a fresh slant to—French foreign policy. To the relief of many European Union partners, he agreed to put forward a revamped EU treaty for ratification by the French parliament and not by referendum (as Chirac had tried and failed to do in 2005). Sarkozy agreed with German Chancellor Angela Merkel to restructure the management of the European Aeronautic Defence and Space Company (EADS) and its Airbus subsidiary. A German ICE high-speed train in May became the first German train since World War II to enter Paris, while in April a French TGV train using the same new Paris–Strasbourg rail line created a new world speed record for a wheeled train of 574.8 km/hr (357.2 mph).

Sarkozy also took a pragmatic approach to the issue of Turkey’s application for EU membership, which he opposed. He gave a green light to negotiations compatible with Turkey’s becoming an associate, but not a member, of the EU. He changed the tenor of traditional French policy as he stressed EU complementarity to NATO, friendship with Israel, and a tough attitude to Iranian nuclear weapons.

Meanwhile, he promoted the idea of a union of Mediterranean rim countries and went to Libya in July and Algeria in December. Visiting Beijing on the eve of a European Union–China summit, Sarkozy bluntly complained about China’s surplus with the EU and the undervaluation of the Chinese currency, which was effectively pegged to the dollar. He also warned that the EU might penalize imports from carbon-emitting countries such as China that did not do enough on climate change, though there was little support in Brussels for this idea.

After going on holiday in August in New Hampshire—an unusual vacationing venue for a French president—Sarkozy returned to the U.S. in early November to make his first official visit as president. During his busy two-day stay, he held private meetings with President Bush, spoke with other American politicians and business leaders, and presented a warmly received address before a joint session of the U.S. Congress. Sarkozy stressed that France would continue to support the fight against terrorism, including keeping French troops in Afghanistan, and endorsed a strong joint stand against Iran’s nuclear program. It remained to be seen whether Sarkozy’s rapprochement with Washington would be as well accepted in France.